Economists see little cheer in falling joblessness

Monday

Dec 23, 2013 at 6:19 AMDec 23, 2013 at 10:43 AM

The Associated Press

STORRS - The state's falling unemployment rate would appear to be good news, but University of Connecticut economists said in a report released Monday that it's due not to job creation, but because workers are quitting the labor force.

In blunt language that quickly drew reactions from the spokesman of Democratic Gov. Dannel P. Malloy and a Republican critic, the Connecticut Economic Outlook said that if labor force participation were still at the level of mid-2010, the unemployment rate would be 10.7 percent. That's more than 3 percentage points higher than the unemployment rate in November.

"So, while Connecticut's sluggish recovery has not only failed to restore jobs lost since 2007, the state's economic malaise (has) driven many adults out of the work force," the economists said.

Andrew Doba, spokesman for Malloy, said 40,000 private-sector jobs have been added since the governor launched several economic development efforts beginning in 2011. Still, Connecticut has "a long way to go," he said.

"While hypotheticals may make for interesting academic work, government must deal with reality," he said.

The unemployment rate fell to 7.6 percent in November, the third straight monthly decline. Nationally, the unemployment rate was 7 percent in November, a five-year low.

Connecticut labor officials said last week that the private sector drove the gains with 4,200 jobs added in November. Unemployment was stuck at a high of 9.4 percent from August 2010 to the end of that year. The rate didn't go below 9 percent until August 2011.

A top Republican lawmaker said the report backs the GOP's criticism of Malloy's economic development initiatives.

"This UConn study confirms what we have been saying for months: The Malloy administration has skewed joblessness lower," said Rep. Larry Cafero, the Republican leader of the state House of Representatives.

The report said Connecticut's job problems began before Malloy took office in January 2011.

"Connecticut has not created and sustained net new jobs in 25 years," the report said. "The extraordinary persistence of weak job creation argues powerfully for profound structural weaknesses in the state's economy, weaknesses that surely pre-dates the devastating recession that hammered the state economy at the opening of the 1990s or the financial crisis in 2007-2008."

The recovery has resulted mostly in extending hours of part-time employees, with some moving to full-time employment, the UConn study said.